Malaysian Employers See Contract Hires In New Light

Image credit: iStockphoto/phototechno/tampatra

It was not long ago when contract working and gig workers were seen as part of the outer fringes of organizational structure. While the trend was catching on in the sharing economy and startup culture, contract staff were barely counted as part of the corporate culture in Malaysia.

That is changing, says the Talent On-Demand report by Professional contracting recruitment services firm Page Contracting Malaysia.

Like anything else, COVID-19 was the catalyst. In the report, 30% of companies said they had to increase contractor hiring to meet the workloads during the pandemic. This created a newfound appreciation of contract working. 

"Before COVID-19 hit in 2020, organizations were already employing contractors as a way to flex and scale their talent needs. The pandemic has emphasized the need for companies to reassess their growth strategy – and the standout component was the deployment of talent, both in the short and medium-term. As a result, companies are facing greater levels of scrutiny on permanent headcount numbers, while others are engaging temporary and contract staff to execute ad-hoc projects," said Marlinda Zulkifli, head of Page Contracting Malaysia.

More Malaysian companies are turning to contract professionals to manage or work on new projects. In the report, 58% said they used contractors for project implementation and digital transformation, which saw acceleration during COVID-19. 

Many Malaysian companies are also using contract working as a means to build their permanent workforce. While the report also noted that 3 in 5 contractors would receive a contract extension in Malaysia, respondents also highlighted that 2 in 5 would get converted to permanent roles on average.

In addition to creating an agile solution to headcount challenges Malaysia's companies face, Zulkifli observed, "An emerging trend that we're definitely seeing is that organizations are now increasingly considering interim staff for senior positions such as C-Suite roles. It offers many advantages, as they're able to benefit from specialized skillsets or knowledge for a specific period of time."

Hiring contractors comes with its challenges. According to the Talent-On-Demand report, 1 in 4 companies had difficulties attracting contingent workers for short-term, contract roles. For a company to position itself as a desirable employer, it must present its benefits package, career opportunities, and company culture and environment in ways that resonate with the contractors. It may be that companies will need to change how they manage their contract hires.

"As organizations look beyond their permanent employees to create an agile workforce, they need to change their way of engaging with the contracting workforce. Traditionally, companies may undermanage non-payroll staff as temporary workers usually only stay in a company for a set period of time," said Zulkifli.

Image credit: iStockphoto/phototechno/tampatra